The article discusses the steps taken by the government to improve fuel efficiency standards and the for the transition to clean sources of energy.

Reducing energy import dependence

• Speaking on the increase in petrol and diesel prices, Prime Minister emphasised the need for clean sources of energy.
• Expanding and diversifying energy supply is good, but if India is to reduce its energy import dependence, it must look towards first managing the demand for petroleum products.
• It is worthwhile to reflect on measures taken by the previous governments as well as this government in this context.

Steps taken

National Electric Mobility Mission Plan

• The UPA-2 administration formulated fuel efficiency standards for passenger vehicles that are now in effect.
• It also constituted the National Electric Mobility Mission Plan (NEMMP).
• While well-intended, both these actions fell short in terms of ambition.
• India’s 2022 fuel efficiency standards for passenger cars are nearly 20% less stringent than the European Union’s standards.
• The NEMMP primarily focused on hybrid electric vehicles.
• Most of the incentives under the NEMMP went towards subsidising mild hybrids instead of electric vehicles.

Multiple fuel pathways

• Recently, the government has encouraged multiple fuel pathways in the transport sector including natural gas.
• The Faster Adoption and Manufacturing of Electric Vehicles (FAME-II) scheme now focuses largely on electric vehicles.
• The government has also provided several additional fiscal and non-fiscal incentives to encourage a transition to electric vehicles.

Steps need to be taken

• There are many things that the government can and should do to
• First, the government should formulate a zero-emissions vehicle (ZEV) programme that would require vehicle manufacturers to produce a certain number of electric vehicles.
• At present, the electric mobility initiative in India is driven largely by new entrants in the two- and three-wheeler space.
• A ZEV programme would require all manufacturers to start producing electric vehicles across all market segments.
• The government should also strengthen fuel efficiency requirements for new passenger cars and commercial vehicles.
• Two-wheelers, which consume nearly two-third of the petrol used in India, are not subject to any fuel efficiency standards.
•  Adopting stringent fuel efficiency standards and a ZEV programme by 2024 can result in India’s petroleum demand peaking by 2030.
• The FAME should be extended not only to all passenger cars and commercial vehicles but also to agricultural tractors.

Conclusion

As the economy recovers from the pandemic, the demand for petroleum products will rise, as will prices. But the government can save money for the consumer while enhancing long-term energy security by wielding the regulatory tools at its disposal.

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